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Volkswagen: Bugs and Outlooks in Car Industry Regulation, Governance and Liability

Published online by Cambridge University Press:  20 January 2017

Marie-Eve Arbour
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Extract

The scandal involving the Volkswagen group broke out last Fall, at the dawn of the very delicate UN Conference on Climate Change (COP21) held in Paris, and the posting of an unofficial version of the Comprehensive Economic and Trade Agreement (CETA). This so, just when a leaked version Transatlantic Trade and Investment Partnership (TTIP) ran through the veins of the Internet and the Trans-Pacific Partnership (TPP) was just about to be signed in New Zealand, fostering market integration by pushing further national treatment and mutual recognition, against the backdrop -albeit one small step at a time- of an increasing demand for environmental protection through the setting, among other regulation tools, of emission thresholds.

Type
Mini-Symposium on the VW Scandal
Information
European Journal of Risk Regulation , Volume 7 , Issue 1 , March 2016 , pp. 4 - 10
Copyright
Copyright © Cambridge University Press 2016

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References

1 Canada and European Union (EU) Comprehensive Economic and Trade Agreement, signed on Sept. 26th 2014 [” CETA “], whose Chapter XX on Technical Barriers to Trade provides for greater cooperation in the field or Motor Vehicle Regulation, in order ” …to strengthen cooperation and communication, including the exchange of information on motor vehicle safety and environmental performance research activities linked to the development of new technical regulations or related standards, to promote the application and recognition of Global Technical Regulations under the framework of the 1998 Global Agreement administered by the WP.29 and possible future harmonization, between the Parties, concerning improvements and other developments in the areas of motor vehicle technical regulations or related standards ” : Annex, art. 1 (emphasis added).

2 The TTIP specifically addresses motor vehicle regulatory issues : see EUROPEAN COMMISSION, “ The Transatlantic Trade and Investment Partnership (TTIP) Regulatory Issues – EU position on motor vehicles”, May 2014, online at http://trade.ec.europa.eu/doclib/docs/2014/may/tradoc_152467.pdf

3 The Trans-Pacific Parternship does not encompass a special, industry-focused section on motor vehicle trade. However, Chapter 2 entitled National Treatment and Market Access for Goods lists specific multilateral Annexes that target US/Japan and Canada/Japan relationships (see 2-D: Canada Appendix D Appendix between Japan and Canada on Motor Vehicle Trade, 2-D: United States Appendix D Appendix between the US and Japan on Motor Vehicle Trade, 2-D: Japan Appendix D-1 Appendix between Japan and the US on Motor Vehicle Trade, 2-D: Japan Appendix D-2 Appendix between Japan and Canada on Motor Vehicle Trade).

4 Regarding the political dimension of thresholds, see Van Lang, Agathe, Droit de l’environnement, Paris, PUF, pp. 78–80.Google Scholar

5 See De Sadeleer, Nicolas, “ La réponse politique à VW ressortit de la chirurgie lourde ”, L’écho, Oct. 6th, 2015, at p. 15.Google Scholar

6 On reads on VW's website : “ Kundenfreundliche Lösungen waren bei der Erarbeitung der technischen Maßnahmen ein wichtiger Aspekt. Für die betroffenen EA189-Dieselmotoren sehen die Maßnahmen wie folgt aus: Die 1,2- und 2,0-Liter Aggregate bekommen ein Software-Update. [1] Die reine Arbeitszeit wird knapp eine halbe Stunde betragen. [2] Die 1,6-Liter Aggregate bekommen ebenfalls ein Software-Update. Zusätzlich wird direkt vor dem Luftmassenmesser ein sogenannter Strömungsgleichrichter befestigt. Die Umsetzung wird weniger als eine Stunde Arbeitszeit in Anspruch nehmen “ : http://www.volkswagen.de/de/volkswagen-aktuell/News.suffix.html/2015∼2Fnox-thematik.html (last visited Feb. 18th, 2016).

7 Volkswagen Canadian Website, at https://www.vwemissionsinfo.ca/ [last visited on Feb. 18, 2016].

8 See “ Scandale Volkswagen : comment un logiciel a-t-il pu tromper les tests antipollution ? ”, Le Monde, Sept. 22, 2015 (online at http://www.lemonde.fr/pixels/article/2015/09/22/scandale-volkswagen-comment-un-logiciel-a-t-il-pu-tromper-les-tests-antipollution_4767405_4408996.html).

9 EPA, “ Notice of Violation ”, online at https://yosemite.epa.gov/opa/admpress.nsf/a883dc3da7094f97852572a00065d7d8/dfc8e33b5ab162b985257ec40057813b!OpenDocument.

10 See “ Une ONG à l’origine du scandale Volkswagen ”, Le Monde, Sept. 22, 2015, (online at http://www.lemonde.fr/planete/article/2015/09/22/l-ong-a-l-origine-du-scandale-volkswagen_4767318_3244.html. The NGO is partially financed by the ClimateWorks Foundation.

11 That is, the Center for Alternative Fuel Engines and Emissions (http://cafee.wvu.edu/).

12 JG Thompson, DK Carder, MC Besch, A Thiruvengadam et HK Kappanna, In-use emissions testing of light-duty diesel vehicles in the United States Final Report Center for Alternative Fuels, Engines & Emissions, West Virginia University, 2014 (http://www.theicct.org/sites/default/files/publications/WVU_LDDV_in-use_ICCT_Report_Final_may2014.pdf).

13 Regulation 715/2007 on type approval of motor vehicles with respect to emissions from light passenger and commercial vehicles (Euro 5 and Euro 6) and on access to vehicle repair and maintenance information, OJ. L 171/1, at art. 3 (10). See similarly, in the US, 40 C.F.R. § 86.1803-01 (penalties at CAA § 205(a), 42 U.S.C. § 7524(a), 40 C.F.R. § 19.4), and, in Canada, the Passenger Automobile and Light Truck Greenhouse Gas Emission Regulations, SOR/2010-201, at art. 9, par. 2 (emphasis added).

14 CNBC WEBSITE, “ VW had previous run-in over ‘defeat devices’ “ (online at http://www.cnbc.com/2015/09/23/vw-had-previous-run-in-over-defeat-devices.html) [accessed on Feb. 24th].

15 “ Le groupe Volkswagen a récemment reconnu qu’il existait des écarts entre les émissions d’oxydes d’azote (NOx) obtenues lors de conditions de circulation réelles et celles obtenues lors de tests sur banc. […] Nous souhaitons aussi vous exprimer nos plus sincères regrets et vous dire que nous ferons tout pour regagner votre confiance “ (https://informations.volkswagengroup.fr/ last visited Dec. 3rd, 2015).

16 See Michael Horn, President and CEO of Volkswagen Group of America, Inc. before the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations, Oct. 8th, 2015, online at: http://docs.house.gov/meetings/IF/IF02/20151008/104046/HHRG-114-IF02-Wstate-HornM-20151008.pdf (last accessed Feb. 23th, 2016): “ On behalf of our company, and my colleagues in Germany, I would like to offer a sincere apology for Volkswagen's use of a software program that served to defeat the regular emissions testing regime ”.

17 See “ Volkswagen fait un premier pas dans l’indemnisation des clients américains”, Le Monde du 10 novembre (en ligne à http://abonnes.lemonde.fr/economie/article/2015/11/10/volkswagen-fait-un-premier-pas-vers-l-indemnisation-de-clients-americains_4806209_3234.html).

18 Jean-Maurice ARBOUR, Sophie Lavallée and Hélène Trudeau, Droit international de l’environnement, 2ème éd., Yvon Blais, Cowansville, 2012, at pp. 910ff.

19 North American Free Trade Agreement (NAFTA), which came into effect on January 1, 1994.

20 April 15th, 1994, 1868 RTNU 141.

21 See art. 904, NAFTA and art. 2.2, TBT.

22 Art. 2.5, TBT.

23 Contained at Commission Regulation (EU) No 459/2012 of 29 May 2012 amending Regulation (EC) No 715/2007 of the European Parliament and of the Council and Commission Regulation (EC) No 692/2008 as regards emissions from light passenger and commercial vehicles (Euro 6) Text with EEA relevance, OJ L 142, 1.6.2012, p. 16–24, OJ no. L 142, 1.6.2012, p. 16.

24 DORS/2003-2, <http://canlii.ca/t/69jq1>

25 (1999), LC 1999, c 33, <http://canlii.ca/t/69g3p>

26 Pursuant to Sections 204 and 205 of the Clean Air Act (“Act”), 42 U.S.C. §§ 7523 and 7524.

27 See complaint at United States of America, Ministry of justice, http://www.justice.gov/opa/file/809826/download and further settlement at https://www.toyotaelsettlement.com/, whereby the company alleges that “ Toyota denies that it has violated any law, denies that it engaged in any and all wrongdoing, and denies that its ETCS is defective. The parties agreed to resolve these matters before these issues were decided by the Court “ (see, similarly in Canada http://www.toyotaelsettlement.ca/index_en.html, and full settlement at http://www.toyotaelsettlement.ca/Documents/Compiled%20Toyota%20Canada%20Minutes%20Settlement%20Agreement%20-%20Executed%20August%206%202013%20%282%29.pdf).

28 For instance, in the UK : the Vehicle Certification Agency (VCA).

29 Directive 2007/46/EC establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles, OJ no. L 263/1. The text replaces national approval systems “ with a Community approval procedure based on the principle of total harmonisation “ (2d Recital)

31 Id., art. 10.1 (1). In this case, the Minister may “ […] require any company that applies a national safety mark to any vehicle or equipment, sells any vehicle or equipment to which a national safety mark has been applied or imports any vehicle or equipment of a class for which standards are prescribed to give a notice of non-compliance in the manner specified by the Minister, if the Minister considers that it is in the interest of safety “ (art. 10 (7)). Such powers could be used for Fiat models which alledgely do not comply to standard 108 of the Canada Motor Vehicle Safety Standard (CMVSS) 108 (which requires the backup lights to light up when the driver turns on the ignition switch and puts the vehicle in reverse). See Transport Canada, Preliminary Determination -2012-2014 Fiat 500 and 500c with Automatic Transmission (online at http://www.tc.gc.ca/eng/motorvehiclesafety/safevehicles-defectinvestigations-1435.html).

32 Whiteman, G., “Volkswagen and the road to Paris”, (2015) vol. 15 Nature, p. 38.CrossRefGoogle Scholar

34 “Leaked” TTIP, at art. […] (art. 21).

35 Directive 2005/29/EC concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC and Regulation (EC) No 2006/2004, OJ no. 149, p. 22.

36 By virtue of the provision: “ 1. Unfair commercial practices shall be prohibited. 2. A commercial practice shall be unfair if: (a) it is contrary to the requirements of professional diligence [which means « the standard of special skill and care which a trader may reasonably be expected to exercise towards consumers, commensurate with honest market practice and/or the general principle of good faith in the trader's field of activity » (art. 2 (h))]; and (b) it materially distorts or is likely to materially distort the economic behaviour with regard to the product of the average consumer whom it reaches or to whom it is addressed, or of the average member of the group when a commercial practice is directed to a particular group of consumers [that is, « to materially distort the economic behaviour of consumers’ means using a commercial practice to appreciably impair the consumer's ability to make an informed decision, thereby causing the consumer to take a transactional decision that he would not have taken otherwise » (art. 2 (e))]” (emphasis added).

37 Directive 2005/29/EC, art. 13.

38 L.R.Q., c P-40.1.

39 See United States Judicial Panel on Multidistrict Litigation, In re: Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation, MDL No. 2151, 9 April 2010 (J. Selna).

40 That is, “ Real Driving Emission Tests “ : voir De Sadeleer, id.

41 https://www.vwemissionsinfo.ca/ (last visited Feb. 18th.); see also the same comment on German site : “ Fest steht: Die Fahrzeuge sind weiterhin technisch sicher und fahrbereit und können deshalb uneingeschränkt im Straßenverkehr genutzt werden “ http://www.volkswagen.de/de/volkswagen-aktuell/News.suffix.html/2015∼2Fnox-thematik.html (last visited Fed. 18th).